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Welcome to Simple Dietz Performance Screen

We have improved Simple Fund 360 Investment Reporting for Planners and Investment advisers by adding a new Simple Dietz Method to the Investment Dashboard. The new method provides a more weighted measure when calculating the return on a portfolio than a simple return method.

The Simple Dietz method measures investment performance during a period, incorporating cash inflows and outflows.

The Simple Dietz method is named after Peter O. Dietz, author of 'Pension Funds: Measuring Investment Performance'.

Navigation

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From the Main Toolbar, go to Investments.
Select Investment dashboards from the list.

Definition Table Non-Unitised/Bank Accounts Unitised Portfolio

Simple Dietz Formulas used: 

Formula used for Non-Unitised investments/Bank Accounts:

Formula for Unitised investments:

 

Definition Table

Notation	Definition	Notes
	The beginning of the period	If there are no holdings at the beginning of the start date selected, t1 will be the date of the first purchase.
	The end of the period	If there are no holdings at the end of the end date selected, t2 will be the date of the last disposal.
	Opening Market Value	The market value of the asset(s) as at the beginning of the selected period.
	Closing Market Value	The market value of the asset(s) as at the end of the selected period.
	Net cash flow on a specific day i	Include any purchases, disposals, instalments, returns of capital and dividend/distribution reinvestments. NCFt1 > Net Cash Flow at the beginning of the period. NCFt2 > Net Cash Flow at the end of the period. All other cash flows are assumed to occur at the mid-point of the period on average.
	Income on a specific day i	The income amount is the amount of cash flow from the income received including any tax credits associated with the income. It1 > Income occurring at the beginning of the period. It2 > Income occurring at the end of the period. All other net income is assumed to occur at the mid-point of the period, on average. It is assumed any income will reduce the market price of investment.

Example Case:

Example 1: Non-Unitised investments/Bank Accounts

Formula used for Non-Unitised investments/Bank Accounts:

The time period selected is 01/07/2017 – 31/12/2017.

Example 1.1: Non-Unitised Asset 1 is purchased on the first day 01/07/2017 for 5000 and is not disposed of. No other purchases for this investment are made in this period. $100 of income is made on the investment.

The beginning of the period		01/07/2017
The end of the period		31/12/2017
Opening Value		0 (Note that Mt1 is the market value of all assets at the beginning of t1. The investment is purchased on t1 so Mt1 = 0)
Net cash flow on the first day		5000
Averaged net cash flow excluding the first day and last day		0
Income for the full period		100

Example 1.2: Non-Unitised Security 2 is purchased on 15/07/2017  for $1000 and is fully disposed on 15/08/2017. No other purchases for this investment are made in this period. $100 of income is made on the investment.

The beginning of the period		15/07/2017 (Note: If there is no holding and balance of a specific investment/bank at the start or end date of the selected period, Simple Fund 360 will calculate the rate of return of the period from the first purchase)
The end of the period		15/08/2017 (Note: If the investment is disposed of in the period, Simple Fund 360 will calculate the rate of return of the period until the last disposal date)
Opening Value		0
Net cash flow on the first day		1000
Averaged net cash flow excluding the first day and last day		0
Income for the full period		100

If the holding period of the investment is not the same as the selected period, users can hover over the investment to see which period Simple Fund 360 has applied to calculate the rate of return.

Example 1.3: To calculate the return for the whole control account 72400, Simple fund 360 looks at all transactions within the control account during the selected period and treats them as one single investment. Therefore, on the control account level:

The beginning of the period		01/07/2017
The end of the period		31/12/2017
Opening Value		0
Net cash flow on the first day		5000
Averaged net cash flow excluding the first day and last day		1000 – 1000 = 0
Income for the full period		100 + 100 = 200

 

Example 1.4: The opening balance for the bank account was -$2900. A purchase was made on 01/07/2017 for $5000. Other transactions to the bank account totalled $1199. Interest income for the bank account was $0.

The beginning of the period		01/07/2017
The end of the period		31/12/2017
Opening Value		-2,900
Net cash flow on the first day		-5,000
Averaged net cash flow excluding the first day and last day		0.5 * 1199
Income for the full period		0

 

Example 2: Unitised Investments

Formula for Unitised investments:

The time period selected is 01/07/2017 – 31/12/2017

Example 2.1: NAB was purchased on 01/08/2017. 100 units were purchased at $2500. No other purchases for this investment are made in this period. $141.43 of total income is made on the investment (dividend + franking credit).

The beginning of the period		01/08/2017
The end of the period		31/12/2017
Opening Value		0
Closing Value		2,957 (As there is no price available on 31/12/2017, the next nearest prices is used. $29.57 per share as at 29/12/2017)
Net cash flow on the first day		2,500
Net cash flow less Income for the full period*		2500 - 141.43
Averaged net cash flow less income, excluding the first day and last day*		0.5 * (0 - 141.43)
Income		141.43 (dividend + franking credit)

*Note: As it is assumed any income will reduce the market price of investment, NCF is reduced by Income in these calculations.

If the latest security price of the investment is not the same as the end period date, users can hover over the closing value to see which price Simple Fund 360 has applied.

Example 2.2: The fund held WBC shares coming into the selected time period. No other purchases for this investment are made in this period. No income is made on the investment. The investment is disposed of on 01/12/2017 where the proceeds of the disposal were $3400.

The beginning of the period		01/07/2017
The end of the period		01/12/2017
Opening Value		3,051
Closing Value		0
Net cash flow on the first day		0
Net cash flow less Income for the full period*		-3,400
Averaged net cash flow less income, excluding the first day and last day*		0
Income		0

*Note: As it is assumed any income will reduce the market price of investment, NCF is reduced by Income in these calculations.

Example 2.3: Rate of Return for control account 77600.

The beginning of the period		01/07/2017
The end of the period		31/12/2017
Opening Value		3,051 (market value of 100 units of WBC shares)
Closing Value		2,957
Net cash flow on the first day		0
Net cash flow less Income for the full period*		-900 - 141.43
Averaged net cash flow less income, excluding the first day and last day*		0.5 * (-900 - 141.43)
Income		141.43

*Note: As it is assumed any income will reduce the market price of investment, NCF is reduced by Income in these calculations.

Example 3: Portfolio Return

To calculate the Portfolio return, Simple Fund 360 uses the formulas used to determine each control account's return and sums up numerator and denominator of each formula.

Bank Account 60400 (Example 1.4):

Numerator	0
Denominator	2530.29

Fixed Interest Securities 72400 (Example 1.3):

Numerator	200
Denominator	5000

 

Shares in Listed Companies 77600 (Example 2.3):

Numerator	0
Denominator	-7300.5

Viewing Investment Performance

Quickly review the balances and performance across all investment classes with Simple Fund 360's interactive data visualisation charts.

Ensure that the balance of investments are within the investment strategy of your funds by effortlessly viewing all movements for your investments for any given time frame

The data source for the chart visualisations is simply the table found underneath the charts, so any filters applied to the table will be reflected in the displayed visualisation.

To view more details for an investment category, hover your mouse over the chart segment to display the full account name, account balance and weighting percentage.

Easily compare the contributions of each investment class towards by the fund's performance by viewing the Income and Market Gain bar chart.

Earnings and losses will be displayed next to each investment class, displaying the exact contribution the investment class contributed towards the fund's performance.

Investment Performance Simple Dietz report

Clients now have the ability to view the Dashboard in the form of a report. The report can be downloaded in the form of a PDF and printed. The report can be accessed from the reports screen. 

Reconciling the Simple Dietz Report figures

The Investment Performance Simple Dietz Report shows three figures for each investment

• Change in Value
• Income; and 
• Income & Market Gain. 

These are calculated differently to the figures shown on the Investment Dashboard and the Investment Income Comparison Report, which is why the income amount for an investment can look different across reports. The calculations below explain how to reconcile them.

Change in Value

This represents the movement in an investment’s market value over the period, after removing the effect of any purchases or sales made during the year (as these are cash flows in/out of the investment, not genuine gains or losses).

Change in Value = Closing Value − Purchases during the period + Sales during the period − Opening Value

Income

This is the total assessable income earned from the investment during the period, made up of:

Income = Franked income + Unfranked income + Interest/other income + Franking credits + Foreign income + Foreign credits

Income & Market Gain

This combines the two figures above to show the investment’s total return for the period.

Income & Market Gain = Change in Value + Income

Worked example

Why this can differ from the Investment Income Comparison Report

The Investment Income Comparison Report is sourced from ledger transactions (dividend and distribution income actually posted to the ledger). Unlike the Simple Dietz Report, it does not include franking credits or foreign tax credits, and it does not include interest income from bank or term deposit accounts – only dividend and distribution income.

Using the example above, the ledger recorded four dividend/distribution transactions totalling $1,373.77. This is the figure the Investment Income Comparison Report will display, whereas the Simple Dietz Report shows $1,455.82, as it also adds the $41.04 franking credit and $41.01 foreign credit.

If an investment is not appearing on the Investment Income Comparison Report at all, check whether its income was posted as interest (which the report excludes) rather than as a dividend/distribution, and confirm the income account is correctly linked to the investment account in the chart of accounts.